This post is part of a series I’m creating connected with Project Service Automation (PSA) for Microsoft Dynamics 365. This time I will consider the sales process.

A key aspect of PSA is the ability for an Account Manager to create an opportunity for a potential project and to prepare quotes. The quotes maybe be based on an estimate created with the support of a project manager. As quotes are confirmed, they will eventually form the basis for a statement of work. A process that will ultimately lead to a won opportunity and a project contract.

The overall process flow is shown below.

All of the standard system entities such as opportunity, products, price list and quote are used in the sales cycle. Implementing Project Service does add enhancements to these entities to support dual tracking of project opportunities and “traditional” ones. Plus, additional concepts such as project contact are included as part of PSA.

Two people (or two roles) are typically connected with the sales process in PSA. Firstly, as you’d expect, the sales person who will create and progress the opportunity. But also, the Project Manager will be involved to help create or refine estimates.

The sales person starts the sales process by creating the opportunity. They optionally itemize the components of the deal. Plus they will form the team of people who will work on the opportunity. This may involve adding details for the project manager or maybe a pre-sales consultant who will assist in the sales process.

Having created an opportunity, you can create multiple quotes. (As is standard with out of the box Dynamics 365.) Quotes are used to give an estimate to the customer. In PSA, they are also used to estimate the projects profitability and to compare the projected prices to customer expectations / budget.

When the quote / opportunity is confirmed (won), a project contract will be created. (Also, commonly known as a statement of work.) Project contracts have project contract lines that can be used to define the invoice schedule.

Opportunity

The opportunity entity defines the price lists to be used and may optionally also contain details of the product and project lines. I describe more detail about opportunities here.

Quotations

One or more quotations can be created for your opportunity. Initially the account manager will enter quote lines that reflect the customers budget.

Then he will work with the project manager to add an estimate to each quote line. The quote line estimates can be for time spend on the project, expenses or other fees. The estimate will in turn then be used to estimate the project’s profitability and compare the expected prices to the customer’s budget expectations.

Once a high-level estimate has been produced you can create a project that will be used to refine the initial high level estimate.

I describe more detail about creating a high-level estimate using quotations here. 

I describe how we create a project and update the high-level estimates, here.

Project Contracts

Marking the quotation as won will create the project contract. You can think of the project contract as the order, in-fact PSA is making use of the Dynamics 365 order entity as the project contract. However, a project contract does differ from a standard order as all of the detailed information for the project estimate, price lists (etc) will be reflected within the contract.

Having created the project contract (sometimes described as a Statement of Work (SOW) in professional services companies), we can add additional information including project milestones and invoicing schedules.

Milestones can be used to drive the billing schedule. These can be manually entered dates or automatically created on a standard frequency. (Say monthly.) For fixed price work the billing schedule will include an amount. For time and materials we simply state the frequency we want invoices and up to what transaction cut-off date.

You can find more detail on project contracts here.

I hope this post has given you a good overview of the sales cycle and how we progress from opportunity to project contract. In later posts I will build on these concepts by looking at how to resource and then manage projects. J